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Flight out of U.S. stock funds accelerates

November 30, 2012: 11:29 AM ET
Investors pulled $7.5 billion from U.S. stock mutual funds during the latest week, bringing the year's total outflow to more than $125 billion.

Investors pulled $7.5 billion from U.S. stock mutual funds during the latest week, bringing the year's total outflow to more than $125 billion.

Investors have been pulling money of the U.S. stocks for months, but the pace of outflows has picked up during the past couple of weeks.

U.S. stock mutual funds lost more than $7.5 billion in the week ended Nov. 20, according to the Investment Company Institute, adding to the previous week's $6.6 billion withdrawal.

In total, investors have yanked more than $14 billion during the two weeks following President Obama's re-election, as they turn their attention to the debate over how to solve the fiscal cliff.

Investors are hopeful that lawmakers in Washington will come to an agreement that avoids the year-end tax hikes and spending cuts, but caution will prevail until an actual deal is struck. The so-called fiscal cliff could harm the economy at a time when the outlook for growth is already in question.

Related: Fiscal cliff countdown: Automatic spending cuts

The total outflow from stock funds now stands north of $125 billion for 2012.

While investors continue to favor bonds funds, demand has started to weaken a bit. During the latest week, investors added $4.5 billion to bond mutual funds, but that's less than the average $6.2 billion they've added each week in 2012.

And demand for international stock funds and hybrid funds, which invest in both stocks and bonds, is also losing traction. After attracting funds for most of the year, international stock funds and hybrid funds lost more than $1 billion each last week for a second straight week.

Overall, mutual funds across asset classes bled $5.5 billion last week -- the most since the start of 2012.

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Hibah Yousuf
Hibah Yousuf
Reporter, CNNMoney

Hibah Yousuf is a reporter at CNNMoney, where she covers stocks, bonds, commodities and currencies trading across the globe, as well as corporate earnings and other markets-related news. Prior to joining the site in 2009, she interned at Money Magazine.

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